As the world's largest electronic product foundry, Foxconn has made a lot of money over the years, and even the founder Terry Gou's worth has skyrocketed, and he has been the richest man in Taiwan Province many times. In fact, the reason why Foxconn was able to soar from a small foundry is nothing more than two reasons: one is to eat the population size dividend and policy dividend under the spring breeze of reform and opening up, and the other is to get all the iPhone orders of Apple with exquisite processing technology and ultra-high yield rate.
However, with the skyrocketing scale and market value of the company, the founder Terry Gou began to become more and more arrogant, not only forgetting the preferential and bonus brought by the mainland policy, but also attributing all the credit to Apple's orders, and even publicly saying many times that "Foxconn came to the mainland to build a factory to give us food", which can be said to be unthankful! And since Cook announced the transfer of production capacity to Southeast Asia, Foxconn is also actively cooperating with Apple's production capacity relocation plan, and has spent huge sums of money to build factories in India, in this regard, Gou Taiming also announced that it will transfer the production capacity of the mainland factory worth 300 billion US dollars to India within three years, and expand the number of employees in the Indian factory to 70,000 people, making it a "second Foxconn production area"!
But what breaks Gou's heart is that spending so much money to build a factory in India has not only failed to get more Apple orders, but even the semiconductor project with the Tata Group has been shelved by the Indian government for various reasons, and now it has fallen into an embarrassing dilemma. What makes Guo Taiming even more unexpected is that the so-called "India's second Foxconn origin" has not yet been completed, and the "second Foxconn" in the mainland market has already appeared.
Speaking of Lixun Precision and Foxconn is quite "fate", its founder Wang Laichun is a former employee of Foxconn, and has also been promoted by Guo Taiming, Wang Laichun also gave Foxconn some small business when he first founded Luxshare Precision, which can be called Foxconn's "back garden". But since 2011, Luxshare Precision successfully entered the "fruit chain", Foxconn's position began to waver, because Apple not only gave the connector order to Luxshare Precision, but also praised it!
The reason why Cook favors Luxshare Precision so much is that no matter how crazy or demanding the requirements are, Luxshare can come up with a good foundry plan in a short period of time and complete it on time and in quantity. Because of this, Cook has been increasing Luxshare's production capacity over the years, and even this year's iPhone15 PLus orders have been divided into 15% to Luxshare, and it is estimated that more orders will be handed over to Luxshare Precision in the future. In fact, there is a reason why Cook made such a decision, because in 2016, Apple wanted to lower the price of foundry, but Foxconn took the lead in opposing it, so Cook now wants to gradually get rid of his dependence on Foxconn foundry.
According to the data, the net profit attributable to the parent company of Lixun Precision in the Q3 quarter of 2023 has reached 7.374 billion yuan, a year-on-year increase of 15.22%, and according to this trend, the net profit of this year has exceeded 10 billion! Foxconn's position in the OEM field is only a matter of time, so it is well deserved to be called the "second Foxconn"!
However, unlike Foxconn, Lixun Precision did not put all its hopes on Apple, but in the diversified layout, on the one hand, it continues to expand customers in the field of automobiles and communications, and on the other hand, it focuses on the core parts business of automobiles to provide cutting-edge R&D design and mass production platforms.
Although Foxconn is still the world's largest electronics foundry, it is too dependent on Apple's orders, and once it loses Apple's orders, it will inevitably usher in a "catastrophe"! And due to Guo Taiming's many wrong decisions and arrogant attitude, its reputation and influence in the mainland have begun to collapse, on the other hand, Luxshare Precision is growing, I believe that it will not be long before Luxshare Precision can rise strongly in the foundry field, until it replaces Foxconn's position!
Source: Official media/online news